Austerity Can’t Solve Crises of Capitalism By Gene Clancy

8 February, 2013 IACenter.org

Millions of workers across the United States received a rude and unpleasant jolt this January when they discovered that their take-home pay had just shrunk by 2 percent. The Social Security payroll tax cut of 2009 was restored, costing workers an average amount of $850 a year, a significant wage decrease for workers on the edge of financial ruin.

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Reshaping Fiscal Policies In Europe: Enforcing Austerity, Attacking Democracy By Hugo Radice

13 February 2013The Bullet • Socialist Project • E-Bulletin No. 772

On December 9th 2011 the European Council announced a new Fiscal Compact, as part of the series of measures undertaken in order to resolve the Eurozone sovereign debt and banking crises. It was incorporated into the Treaty on Stability, Coordination and Governance (TSCG), signed by 25 <strong class=’StrictlyAutoTagBold’>EU governments in March 2012, subsequently ratified by the signatory national governments, and in force from January 2013.[1] The Compact includes a commitment by those governments to a cap of 0.5% on the ‘structural deficit’ implied by their annual revenue and expenditure plans. It also reinforces the existing Maastricht Treaty fiscal rules through an obligatory adjustment procedure, to be enforced by the European Court of Justice. Continue reading

America’s Deceptive 2012 Fiscal Cliff By Michael Hudson

28 December 2012 — Michael Hudson

How today’s fiscal austerity is reminiscent of World War I’s economic misunderstandings

When World War I broke out in August 1914, economists on both sides forecast that hostilities could not last more than about six months. Wars had grown so expensive that governments quickly would run out of money. It seemed that if Germany could not defeat France by springtime, the Allied and Central Powers would run out of savings and reach what today is called a fiscal cliff and be forced to negotiate a peace agreement.

But the Great War dragged on for four destructive years. European governments did what the United States had done after the Civil War broke out in 1861 when the Treasury printed greenbacks. They paid for more fighting simply by printing their own money. Their economies did not buckle and there was no major inflation. That would happen only after the war ended, as a result of Germany trying to pay reparations in foreign currency. This is what caused its exchange rate to plunge, raising import prices and hence domestic prices. The culprit was not government spending on the war itself (much less on social programs).

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War or prosperity? UK’s price tag for Afghan war rises to $30 billion while cutting vital social services at home

20 December 2012 — RT

“The UK has revealed that the cost of its involvement in the war in Afghanistan has reached $27.6 billion, and may end up being as much as $32.5 billion. Meanwhile, the UK continues to slash domestic social services to reduce its budget deficit.

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A different kind of Europe By Trevor Evans

22 March 2012 — Red Pepper

Trevor Evans outlines the basis for a progressive pan-European response to the euro crisis

The growth of private international financial institutions since the 1970s has seriously curtailed the ability of national governments to exercise democratic control over economic policy. This was vividly demonstrated early in the 1980s, when capital flight forced the French government to abandon its programme of progressive economic reforms. Since then, finance has become much stronger, and the constraints are especially severe for smaller countries.

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Greece Newslinks 3-6 October 2011

6 October 2011 — williambowles.info

6 October 2011
Greece government workers stage protest strike
San Francisco Chronicle
As Greece struggles to avoid a catastrophic default, demonstrators in Athens expressed outrage over their misfortune and bewilderment at a crisis that shows no signs of easing. “Nobody knows what’s going on. Every day they say something different. …
http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2011/10/05/MNMJ1LDM2U.DTL

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